Fii Stake In Bajaj Auto Rises To 13%

Shareholding of foreign institutional investors (FIIs) in Bajaj Auto stands increased at 12.99 per cent as on March 31, 2001, against 10.05 per cent in the previous year.

This is in contrast to the dip in holding by global depository receipt (GDR) holders and non-resident Indians (NRIs) following the buy-back offer made by the promoters last October.

According to the company's annual report for 2000-01, the percentage of GDRs stands reduced at 4.65 per cent of the total shares as opposed to 5.46 per cent in the previous year.

GDR holders opted to reduce their stake and sold their underlying shares to the tune of 18.12 lakh through the open offer.

"The company bought back 9.05 lakh equity shares underlying the GDRs in the buy-back offer," said senior officials.

However, even as NRI holding rose marginally following the buy-back from 0.51 per cent to 0.53 per cent, the actual number of shares held by NRIs have fallen from 6.09 lakh shares to 5.34 lakh shares.

In contrast, FIIs portfolio investment in the auto major revealed a net acquisition during fiscal 2000-01 by 12 lakh shares to an aggregate holding of 1.31 crore shares.

The rise in FII holding assumes significance in view of the promoters exercising buy-back of shares last October.

Following the company's buy-back of 1.8 crore shares at Rs 400 per share, the price of the scrip has fallen sharply from Rs 368 in September to Rs 330 in October, and is currently ruling at Rs 259.60.

A key objective behind the buy-back offer was to offer an attractive exit option to small shareholders.

Despite a "bad year...financially the worst in recent history", the management is confident that through a number of growth initiatives taken by the company to capture a larger market share and improve profitability, "the long-term scenario is likely to turn positive for the company and its shareholders".